What is a Chatbot and How it is Used for Business
With artificial intelligence becoming commonplace, chatbots are becoming increasingly popular; virtual chat agents that mimic human conversations to provide resolution for user queries are no longer a novelty, but a necessity. We’re already seeing them in messaging apps and on websites, automating customer support and having human effort, time as well as money. According to Gartner, by the next year, virtual chat agents or chatbots will handle more than 85% of customer queries. Chatbots are not limited to giving responses to simple customer queries, however; they can also be used to collect user information, set up meetings, and bring down overheads.
What exactly is a chatbot?
The Oxford dictionary defines a chatbot as: “A computer program designed to simulate conversation with human users, especially over the Internet.”
What Does a Chatbot Do?
It is a virtual assistant that converses with humans via text messages. It can be integrated in instant messengers, websites and other applications, and enables businesses to build close relationships with customers. A chatbot is in essence, an automated communication system.
Why does a business need chatbots?
Businesses can benefit from chatbots in several ways:
- Automate repetitive, mundane tasks
- Speed up resolution of customer queries
- Provide 24/7 customer support
- Minimize human error due to fatigue
- Gain customer loyalty
Benefit to Customers
- Customers get round the clock support or information quickly and efficiently
- Chatbots often entertain users with witty quips
- Conversations and social experiences are fueled by chatbots
- Many users are curious and want to experience talking to a virtual agent – entertainment value
Types of chatbots
Simple Chatbots
These bots function based on pre-determined keywords that they are ‘taught’ and understand. Every command has to be written individually by the coder using regular expressions. When the user asks questions without using any of the keywords the bot understands, it will return a response like : ‘Sorry, I did not understand what you said’.
Smart Chatbots
These rely on AI in the customer interactions. They don’t have predetermined answers, rather they provide suggestions. Whatever the customer says is recorded for processing later. Of course, it’s not easy creating these chatbots, as the learning process is slow, and the designers and developers have to put in a great deal of effort to make it happen.
What can chatbots do for your Business?
Startups as well as established companies are turning to chatbots for their routine customer communication, operations and even sales processes. Chatbots can:
- Deliver enhanced customer service. No more being put on hold, waiting for a human agent to finish their conversation with another customer. Instant query resolution, and the customer is happy; most customers are also not inclined to go through the FAQ section which often run into several pages. They prefer to talk to someone instead. By handing over such queries to the bot, you can free your employees from this task and increase productivity by assigning them more critical tasks.
- Generate more qualified leads. Chatbots can direct the complex queries to relevant personnel after taking all the customer’s details. They ask questions depending on where the customer is on the site; if they are on the pricing page, the bot can explain the pricing in detail. Chatbots are capable of adding 30% more qualified leads to the top of the sales funnel.
- Streamline the buying process. Customers can simply type what they want, and the chatbot sends the info to the sales department; the customer doesn’t have to repeat themselves. Additionally, chatbots record your preference, making your return experience smoother.
- Personalize Communication. Rather than displaying a great deal of info, chatbots provide specific answers to questions – it’s customized information for a buyer. This provides greater incentive to purchase.
- Improve the Response and conversion rate. Chatbots respond to every single query they receive; they can convert more visitors than any other engagement tool.
- Automate repetitive tasks. There are some standard questions that most customers tend to ask, and they are usually to do with the location, shipping options, office hours, payment options, and so on. These can be easily ‘taught’ to a chatbot, and you can take a weight off your employees’ shoulders. Precious human resources can be diverted to more critical business tasks.
- Upsell an Abandoned Cart. Sometimes customers add products to the cart and even go to the payment page but don’t carry through with the purchase. Chatbots can identify when the user comes back to the site and offers to complete the transaction or remind them about their products in the cart. Though companies use SMSes and emails to prompt users about their unfinished purchases, chatbots have an increased success rate of about 40%.
- Increase employee collaboration. Most companies today use project management tools to foster better communication and collaboration among team members – like IPIX TMS, Basecamp, Slack, or Trello. Chatbots can be integrated into these tools and several critical but time consuming processes can be automated, like:
- Team updates – chatbots can gather daily updates from team members, generate reports and send them to the manager
- Chatbots can be used to create and send notifications about meetings and demos 15 minutes before the scheduled start
- Internal FAQ: various departments need to follow their own rules and regulations, and in some cases, Government regulations as well. Chatbots can help employees comply with GRC requirements based on the query intent. Internal teams will be saved from the task of providing resolution to the queries.
To Sum Up
Though chatbots can have wide ranging benefits, many business owners have still not caught on to the fact. While the technology is still in its infancy, it is already helping businesses in achieving business goals and delighting customers. With the capabilities expected to increase, it would seem that investing in a chatbot for your business may be one of the wisest decision you take.
Do get in touch with us enquiry@ipixtechnologies.com and we will tell you how we can help you.